Equities hovered around the flatline to end nearly unchanged Tuesday with earnings news and Federal Reserve comments in focus. The Dow industrials were flat, the S&P 500 firmed 0.1 percent, and the Nasdaq was down 0.1 percent. US Treasury yields and oil prices declined while the dollar was mixed.

Comments from Fed officials weighed on sentiment as policy-makers insisted the economy is strong and inflation remains problematic. James Bullard, the St. Louis Fed president and a noted hawk, said at least 50 basis points in rate hikes are needed to get to neutral, while Atlanta Fed President Raphael Bostic said his base case calls for only 25 basis points before going on hold. Both officials downplayed the view that the economy is headed for recession, and both dismissed suggestions that rate cuts are coming later in the year.

Among sectors, disappointing results from Johnson & Johnson depressed health care. Defensive plays lagged, with utilities, consumer staples, real estate investment trusts, and telecom weak. Poor results from Goldman Sachs, BankAmerica, and BNY Mellon weighed on banks. Chipmakers didn't get much support from strength in Nvidia after an analyst upgrade.

Best sectors included aerospace & defense after upbeat results from Lockheed Martin. Housing and home goods stocks advanced as investors liked monthly housing starts and building permits data. Travel & leisure had a good day, led by China-linked casinos after very upbeat Chinese retail sales data.

Market Reflections track market reaction to the trading day's major events. Economic data, policymaker speeches, and company news are featured in this report as well as key indexes and financial instruments.

Understanding why markets respond as they do is fundamental for an investor. Market Reflections help explain how the day's events, news, and data impact the outlook for the economy and for market prices.